Archive for July, 2011

There has been a lot of back and forth, up and down on this debt hike bit. It is frustrating, actually infuriating, and it has become the forcing function to addressing- in a serious way- our ever growing national debt. Some have been taking it serious. The Cut, Cap and Balance effort was a righteous one, and I think we’ll see it again after the GOP takes control of the Senate in 2012 (Yes, I predict the Senate will go Red in the 2012 elections. By a lot.). We’ve actually only had one plan from the Dems, which is Harry Reid’s recent capitulation, however it is full of accounting gimmicks, like counting the end of the Afghan and Iraq wars as cuts. It doesn’t stand a chance in the House, which leaves the Speakers plan, which is a temporary hike to the debt ceiling, followed by a sincere (not a word used by Dems often) effort to reform and cut spending.

The problem is that this is not a new problem. The media has been talking about this deadline for months, but Washington- and particularly the Administration- did nothing, even though the Administration has been reporting doom and gloom the whole time if it was not raised. Turbo Timmy, our tax-challenged Treasury Secretary, has predicted Armageddon if his ability to burn through cash is not reinstated immediately. Economists as well have been very concerned about the debt ceiling, with S&P and Moodys both reviewing the possibility of downgrading America’s credit rating- for the first time ever. The markets are spooked, schizophrenically climbing and diving hourly based on rumor and conjecture. It’s not a good situation to be in.

But here is the rub- priorities. The ramifications of the debt have been explained, to the chagrin of the Administration who prefers to think the common man too stupid to understand that spending more than you make is a bad. So, for the benefit of the layman, here’s where we are at: in the interest of taking away the scary number of trillions- which no one seems to be able to wrap their minds around how large that number really is- lets substitute thousands. The nation makes about 2.2 trillion a year, so we’ll call it $22,000, but Obama’s last budget was 3.7 trillion, $37,000. We’re in debt 14.3 trillion, or $143,000, and are projected to see that increase to 16 trillion, or $160,000 by next year. Now, any of us having a family member making $22,000, but spending $37,000- a $15,000 deficit- when they were already $143,000 in debt would have zero sympathy and would probably have an intervention recognizing that they were about $5 from bankruptcy. That’s right, bankruptcy. Interest on our debt alone costs hundreds of billions of dollars a year. This is only going to get bigger and bigger and these big entitlement programs begin to cost more and more, which they all will, thus sending us down a downward spiral into economic hell.

None of this is new. We’ve seen this picture clearly for years and years. The only change has been in the accelerated rate at which Obama has forced this crisis upon our heads. You cannot spend 5 trillion more than you make in three years and not think that there will be some kind of ramification. Deficit hawks have been crying about the billion dollar deficits for decades, but it has taken Obama and his trillion dollar deficits to really sink in the notion that this is unsustainable. Yet, the warnings went unheeded, the alarm ignored. We are at the precipice. We are looking into the abyss, a future where our currency has no value and our children are financially raped by the excesses of a generation too selfish to care. The Baby Boomers have demonstrated an unmitigated, constant focus on “me” at the expense of everyone else. The generational fratricide executed by the Baby Boomers on the younger generations is criminal.

So it is with baited breath that we wait and watch. Who will cave? Who will fight? Who is going to be the adult in the room and recognize that the path taken leads to hell, to a place where are children suffer because we failed to make the right choice. It is good that the Greatest Generation has more or less died off, for if they were here, they would see what their loins had wrought, and I think they’d be ashamed. Of course, we’re left watching our sires drift into economic dementia, incoherently driving us and everyone else around them into a state of fear like none other.